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(Bloomberg) — Buyers of liquefied natural gas in Australia fear that recent policy changes to protect domestic resources and reduce emissions could limit exports, according to the country’s largest seller.
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LNG buyers, including Japanese companies, told Woodside Energy Group Ltd. Earlier this month they were worried about future supplies, CEO Meg O’Neill said. She added that Woodside is in talks with the Australian government to resolve these policy concerns.
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“They are seeking to ensure that Australia will continue to be a trusted and reliable supplier of LNG,” O’Neill said. “Buyers are concerned about the number of regulatory changes that have been implemented.”
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Earlier this year, the government passed its safeguard mechanism legislation, which would require Australia’s biggest polluters, including giant LNG plants, to reduce their emissions over time. In addition, a cap on gas prices was put in place in late 2022 to protect Australians from rising energy prices, while policymakers revised measures that could restrict LNG exports as a last resort to ensure supply at home.
The Japanese government has expressed concern that the new rules threaten energy security, The Wall Street Journal reported earlier this month. Australia was the largest supplier of LNG to Japan last year, according to ship-tracking data.
The solution to domestic gas challenges is to increase supply, O’Neill said, and the government must take steps to encourage more LNG into the market.
“We need to make sure that it is the policy framework here that allows us as a nation to fulfill our obligations to our trading partners,” she said.